The frontline indices gained 0.88 per Cent and 0.77 per cent, respectively for the week after having logged losses in each of the past five weeks since hitting record highs on July 20.

In its derivatives, monthly rollover report, domestic brokerage firm Religare Broking revealed that the August Series Nifty closed at 19,250 after Volume weighted average price (VWAP) based selling activity was witnessed throughout the day. 

In its report, Religare highlighted that at 96 per cent, cement is the sector where highest rollover was witnessed in the August series. Whereas at 88 per cent, power was the sector where lowest rollover was witnessed.

 ’At expiry, VIX was at around 12.5 per cent levels implying around 680 odd points swing in the NIFTY in next 30 days,” said Religare Broking. 

Nifty September Futures contract Open Interest started with around 100 lakh vs 117 lakh in August. BankNifty September futures have seen an Open Interest of around 23.6 lakh vs 18.84 lakh in August.

Nifty futures has rolled at around 78 per cent vs 84 per cent which is lower with respect to the previous series. The Open Interest for the new contract is also lower by around 17 lakh with respect to to the last month contract implying long unwinding of positions in the index.

Outlook for September

Short rolls was seen majorly in September Series. For September futures with an average price of around 19,400 which becomes a pivot for the month. Till the time Nifty trades below 19,400, the index might be on sell on rise mode. 

‘’We expect the Nifty to find strong support at 19,000-19,100 levels for September series. On spot basis 19,600-19,000 might be the range for Nifty for first fortnight of September series,” said Religare Broking.

Foreign institutional investors (FIIs) have sold around ₹20.6k crore in cash market for the August month. FIIs long ratio is now at 50 per cent vs 59 per cent index futures implying more of hedged short positions into the September series. With the VIX being at lower levels of 11-12 per cent first dip towards 19,100-19,000 might be more prudent for fresh long positions, said the brokerage in its report.

The brokerage believes auto and chemical and technology are the sectors that can outperform the index in the September series.

Which stocks to invest in August series as per Religare Broking?
 

Maruti Suzuki, Coal India, Voltas, SBI Life Insurance, Mphasis, and rhe Indian Hotels Co Ltd are the top picks for the September series, according to Religare Broking.

Maruti Suzuki (CMP : 10,050): 
Fifth straight month for the stock giving positive returns. In August series also, the stock managed to add 13 per cent longs with slightly lesser rollovers. ‘’We believe the stock can outperform the benchmark in September series as well. So holding support of 9,650, be positively biased for Maruti,” said Religare Broking.

Voltas(CMP : 870): 
After prolonged downtrend, the stock managed to gain almost 14 per cent on the back of short covering. Trading at 870, we believe stock is poised for further upside. ‘’So keeping a stop at 795, we vouch to go long in Voltas for an upside target of 950,” said the brokerage.

Coal India (CMP : 236.5): 
After some base formation, Coal India gained nearly 2 per cent in August series on the back of some short covering and formation of longs. ‘’With good delivery based buying as well, we believe stock is poised to march upwards. So be positive in the stock with a stop at 227,” said the brokerage.

SBI Life Insurance (CMP : 1320): 
The stock has done not done anything in last two series but seen addition of 23 per cent OI with that being rolled at good 96 per cent. ‘’With convincing cash based buying in the stock, we believe holding 1,280, the stock has the potential to test 1,400 levels,” said Religare Broking.

Updated: 01 Sep 2023, 05:44 PM IST